Jeremy Corbyn's message looks great - but check the small print

There’s no doubt about it – the Labour Party has reached a fork in the road and on 12 September the fate of the progressive centre-left in Britain will be sealed. There are millions whose living standards and working conditions depend on Labour winning government in 2020 to fight for power, wealth and opportunity in the hands of the many not the few. If we get this wrong, the Tories could be in office for a generation. So I urge Labour members to think incredibly carefully and look at the detail before they cast their vote.

The superficial appeal of those on the hard left may be tempting at one level; big bold rhetoric presents a ‘clear choice’ to motivate the currently unenthused. But we have a duty to scrutinise the consequences of those policies being espoused with such sweeping certainty. Take, for example, the proposal for a ‘People’s Quantitative Easing’ where the Bank of England is instructed to use QE to directly finance infrastructure and public service projects. At one level it sounds so easy – if there’s a shortage of money, just print some more!

But ending the Bank of England’s independence and reversing one of Labour’s most enduringly successful reforms would risk a major hike in lending rates, taking money away from schools and hospitals as debt servicing becomes more expensive. And resorting to the printing press to artificially create money for public expenditure purposes would be a major distortion for the economy. Such a new monetarism would spark higher inflation and make it harder for those on lower incomes to afford goods and services, provoking a rise in mortgage rates to counteract the effect. You can’t magically abolish the deficit with printed money and expect zero repercussions for the least well-off and those already struggling with loans and debts.

Of course there’s always more to be done to clamp down on tax avoidance. But if you base your economic policy by vastly over-estimating the amount you can get from tax loopholes, you cannot deliver on the promises you are making. The people in need of real help will be the ones who pay the price.

It is vital the policy options being proposed are rigorous and can stand up to scrutiny. Labour members must not choose a Leader only to discover they have backed a policy agenda whose small print could end up hurting the very people we want to stand up for.

It is true that the Tories have used this period to shrink levels of public investment under the guise of deficit eradication. But that doesn’t mean there is anything ‘left wing’ about wanting to run a deficit in perpetuity. In fact, for those of us who believe in the virtues of collectively purchased public services, we have a duty to prove that the state can be a sound steward of taxpayer resources. If we fail to show we can live within our means in the long run, taxpayers will lose confidence in the pooling of collectively providing health, education or policing – and they will increasingly lose faith the public realm. Any Labour Leader who thinks budgets can always be in the red will discover taxpayers are distinctly unimpressed by the idea – and that Leader will in turn be responsible for permanently damaging the coalition of support we need to sustain decent levels of public investment.

Economic credibility isn’t just about winning elections – it is about securing the resources we need to invest in public services, improve education and abolish child poverty. It is about retaining public consent for the collective pursuit of those ambitions. And ill-considered policies that drive up the cost of living and inflation will hurt the poorest people in society.

Britain needs a credible Labour Prime Minister, not the Tories in government for a generation. Labour members must weigh up carefully what is now at stake.

Labour’s renationalisation plans look nothing like the 1970s

A community energy company in Nottingham, a credit union in Oldham and, yes, Britain's most popular purveyor of wine coolers. No, this is not another diatribe about about consumer rip-offs. Quite the opposite – this esoteric range of innovative companies represent just a few of those which have come to the attention of the Labour leadership as they plot how to turn the abstract of one of their most popular ideas into a living, neo-liberal-shattering reality.

I am talking about nationalisation – or, more broadly, public ownership, which was the subject of a special conference this month staged by a Labour Party which has pledged to take back control of energy, water, rail and mail.

The form of nationalisation being talked about today at the top of the Labour Party looks very different to the model of state-owned and state-run services that existed in the 1970s, and the accompanying memories of delayed trains, leaves on the line and British rail fruitcake that was as hard as stone.

In John McDonnell and Jeremy Corbyn’s conference on "alternative models of ownership", the three firms mentioned were Robin Hood Energy in Nottingham, Oldham credit union and, of course, John Lewis. Each represents a different model of public ownership – as, of course, does the straightforward takeover of the East Coast rail line by the Labour government when National Express handed back the franchise in 2009.

Robin Hood is the first not-for-profit energy company set up a by a local authority in 70 years. It was created by Nottingham city council and counts Corbyn himself among its customers. It embodies the "municipal socialism" which innovative local politicians are delivering in an age of austerity and its tariffs delivers annual bills of £1,000 or slightly less for a typical household.

Credit unions share many of the values of community companies, even though they operate in a different manner, and are owned entirely by their customers, who are all members. The credit union model has been championed by Labour MPs for decades.

Since the financial crisis, credit unions have worked with local authorities, and their supporters see them as ethical alternatives to the scourge of payday loans. The Oldham credit union, highlighted by McDonnell in a speech to councillors in 2016, offers loans from £50 upwards, no set-up costs and typically charges interest of around £75 on a £250 loan repaid over 18 months.

Credit unions have been transformed from what was once seen as a "poor man's bank" to serious and tech-savvy lenders where profits are still returned to customers as dividends.

Then there is John Lewis. The "never-knowingly undersold" department store is owned by its 84,000 staff, or "partners". The Tories have long cooed over its pledge to be a "successful business powered by its people and principles" while Labour approves of its policy of doling out bonuses to ordinary staff, rather than just those at the top. Last year John Lewis awarded a partnership bonus of £89.4m to its staff, which trade website Employee Benefits judged as worth more than three weeks' pay per person (although still less than previous top-ups).

To those of us on the left, it is a painful irony that when John Lewis finally made an entry into politics himself – in the shape of former managing director Andy Street – it was to seize the Birmingham mayoralty ahead of Labour's Sion Simon last year. (John Lewis the company remains apolitical.)

Another model attracting interest is Transport for London, currently controlled by Labour mayor Sadiq Khan. TfL may be a unique structure, but nevertheless trains feature heavily in the thinking of shadow ministers, whether Corbynista or soft left. They know that rail represents their best chance of quick nationalisation with public support, and have begun to spell out how it could be delivered.

Yes, the rhetoric is blunt, promising to take back control of our lines, but the plan is far more gradual. Rather than risk the cost and litigation of passing a law to cancel existing franchises, Labour would ask the Department for Transport to simply bring routes back in-house as each of the private sector deals expires over the next decade.

If Corbyn were to be a single-term prime minister, then a public-owned rail system would be one of the legacies he craves.

His scathing verdict on the health of privatised industries is well known but this month he put the case for the opposite when he addressed the Conference on Alternative Models of Ownership. Profits extracted from public services have been used to "line the pockets of shareholders" he declared. Services are better run when they are controlled by customers and workers, he added. "It is those people not share price speculators who are the real experts."

It is telling, however, that Labour's radical election manifesto did not mention nationalisation once. The phrase "public ownership" is used 10 times though. Perhaps it is a sign that while the leadership may have dumped New Labour "spin", it is not averse to softening its rhetoric when necessary.

So don't look to the past when considering what nationalisation and taking back control of public services might mean if Corbyn made it to Downing Street. The economic models of the 1970s are no more likely to make a comeback then the culinary trends for Blue Nun and creme brûlée.

Instead, if you want to know what public ownership might look like, then cast your gaze to Nottingham, Oldham and dozens more community companies around our country.

Peter Edwards was press secretary to a shadow chancellor, editor of LabourList and a parliamentary candidate in 2015 and 2017.